1. Company profile: leading enterprises of pharmaceutical packaging materials. The company's main products are cold stamping composite hard sheet, PTP aluminum foil, SP composite film, raw material bags and other soft packaging materials and PVC, PVC/PVDC, PVC/ polytrifluoroethylene, plastic bottles, aluminum-plastic composite covers and other hard packaging materials. The company's main products are widely used in the packaging of tablets, pills, capsules, powders and suppositories of well-known pharmaceutical brands at home and abroad, such as AstraZeneca PLC, Huahai Pharmaceutical Industry, Yunnan Baiyao, Lizhu Group and so on. In 2020, the company's flexible packaging pharmaceutical packaging materials and hard packaging pharmaceutical materials accounted for 73.71% and 25.37% of business income respectively.
2. Pharmaceutical packaging business: based on advantages and expanding production capacity
The size of the domestic pharmaceutical packaging market has reached 100 billion yuan, and policies such as consistency evaluation, volume procurement and related review have brought new opportunities; domestic pharmaceutical packaging factories are relatively scattered, and the concentration is expected to increase in the future. The market size of the domestic pharmaceutical packaging industry exceeded 100 billion yuan in 2019, with a compound growth rate of 10.5% from 2015 to 2019. The market size of the domestic pharmaceutical packaging industry related to the company's business is in the range of 15 billion yuan. With the deepening of medical system reform, the implementation of policies such as consistency evaluation, volume procurement and related review have brought a new round of opportunities for enterprises. With the promotion of consistency evaluation and the implementation of the evaluation and approval system for the relationship between raw materials, pharmaceutical excipients and drug packages and pharmaceutical preparations, the trend that the backward drug packaging materials are gradually banned and eliminated is obvious. With volume procurement gradually normalized, promote import substitution, but also promote large-scale production of enterprises. Correlation review promotes the improvement of pharmaceutical packaging quality requirements, and the improvement of industry concentration is expected to accelerate.
The company's products are divided into two categories: soft packaging and hard packaging, with a compound income growth rate of 19% in the past five years, and the gross profit margin fluctuates with the price of raw materials. The company's historical revenue has grown rapidly, with year-on-year growth rates of 25%, 35%, 22% and 15% respectively from 2017 to 2020. Although the company's historical gross profit margin has some fluctuations in raw material prices, the comprehensive gross profit margin reached 37%, 33%, 31% and 34% respectively from 2017 to 2020.
The main raw materials of our products are aluminum foil, PE, PVC and adhesive. The increase in the comprehensive gross profit margin of products in 2020 compared with the previous year is mainly due to the decline in the prices of raw materials such as aluminum foil, PE, PVC and adhesives compared with the previous year.
The company's competitive advantages include: customer resources, R & D innovation, product quality, team and management advantages. By June 30, 2021, the number of customers who had business relations with the company had exceeded 2000, including 80% of the top 100 enterprises in China's pharmaceutical industry. won Huahai Pharmaceutical, Federal Pharmaceutical, Zhengda Tianqing, AstraZeneca PLC, Novartis AG and other domestic and foreign customers recognition and orders. In the past three and a half years, the company has issued more than 3000 authorization letters for customer consistency evaluation or new drug declaration.
The capacity reserve is sufficient, and the first and second phases of Nanxun have been put into production to release capacity increment. The annual production capacity of the company is 26000 tons in 2020. the production capacity of Nanxun Phase I and Phase II is expected to reach 2.8,3.0 and 48000 tons respectively in 2021-2023. The construction period of the first phase of Nanxun project is 18 months, and the civil construction work has been completed, and it is planned to be completed and gradually put into production in the second half of 2021, with an increase of 3700.00 tons / year after it is put into production. The construction period of Nanxun Phase II project is 18 months, with an additional planned production capacity of 18000.00 tons / year.
3. Focus on expanding new consumption, new energy and other packaging fields. Based on the original production technology of pharmaceutical packaging materials, the company expands new consumption, new energy and other fields. In the past five years, the proportion of total cheese consumption and per capita cheese expenditure has increased rapidly. Haishun Xincai has signed contracts with Mengniu and other companies to expand cheese bar packaging products. The company expands the blister packaging products of e-cigarette customers. The company is based on cold aluminum technology and is expected to form aluminum-plastic film production capacity early next year.
4. The leading companies of pharmaceutical packaging materials actively extend to the field of new consumption and new energy, and give the rating of increasing their holdings for the first time. It is estimated that the company's net profit from 2021 to 2023 will reach 1.2,1.7 and 210 million yuan respectively, an increase of 16%, 39% and 28% over the same period last year, corresponding to the PE valuation of 33, 24 and 19 times. The pharmaceutical packaging industry ushered in new policy opportunities, and the concentration of the domestic industry is expected to increase. The company's income has grown at a compound growth rate of 19% over the past five years. With the advantages of customer resources, R & D and innovation, product quality, team and management, production capacity will release increments. Packaging areas such as new consumption and new energy may become new growth points.
5. Risk hints: higher-than-expected prices of raw materials, lower-than-expected business expansion of new consumer packaging materials, lower-than-expected business expansion of aluminum-plastic film, intensified competition in the industry, etc.
